Mobile solutions are more than apps, Part 3: Underpinning the entire Fintech sector
Marc Andreessen, the famous venture capitalist and technologist, once said that software is eating the world. That is true, but a very good case can be made for apps and mobile solutions also eating the world now.
Apps are redefining industries
Mobile apps are redefining entire industries that, before the rise of the smartphone, existed solely on other types of offerings. The flexibility and versatility of the mobile app is allowing new capabilities and services to rise to the top of the heap and transform consumer offerings.
Mobile solutions are the root of the Fintech industry
What is particularly fascinating about the rise of the mobile app is how it can create entirely new industry sectors, and nowhere is that more clear than in the case of the financial technology, or Fintech, vertical. Fintech captures the essence of quick innovation and fast time-to-market, and it adds value to existing industries and processes that is central to mobile app development. The FinTech sector stands to disrupt banks, credit unions and other financial institutions with great technology that all centers around good mobile apps.
The following are three examples of FinTech apps:
Digit is an example of an app that adds value to existing bank accounts. It uses algorithms to monitor spending, detecting small amounts of money that could be saved without affecting your normal monetary routine, and transfers these tiny chunks of money to a Digit banking account. This makes saving both automated and easy, because the app is doing all the heavy lifting. The service even guarantees against overdrafting your existing bank account because of a Digit-based transfer, overcoming the biggest consumer objection. And, getting saved money back out is as simple as sending a text message.
This is the Digit for investing in the stock market. Acorns has a different approach to pulling money out of your everyday spending. Instead of finding small amounts to transfer entirely, Acorns rounds up all of your purchases to the nearest dollar and then transfers the rounding differences to a brokerage account. From there, you can invest in a stock portfolio that an intelligent questionnaire chooses for you. The app is synced with your checking account and debit card and can be used with a synced credit card as well for additional transfer opportunities.
For children and teenagers (and parents who want to help establish great financial habits for their kids), there’s Bankaroo, the virtual bank for kids. Bankaroo helps kids track their allowances and gift money, learn to budget the funds and set up goals for their saved money. It also helps children learn how to keep track of their money for giving, saving and spending.
Brick-and-mortar banks have to learn to keep up with the technology being displayed by these disruptive FinTech companies. Mobile solutions are making it possible to extend these banks’ traditional products and services, turning them into entirely new companies.
This is Part 3 of the “Mobile solutions are more than apps series.” Be sure to catch up on Part 1, “How apps can make or break retail products,” and Part 2, “Adding new features to healthcare products.”